Is AI Swallowing Your Portfolio?

DANO WEIR: Happy Friday. Welcome to On The Markets from Sonoma Wealth Advisors and the brands of Sonoma Wealth Advisors and Fermata Advisors, Fermata 401K, Fermata Tax, and Fermata Insurance. My name is Dan O'Weir. It is August 8th, 2025. Please welcome back to the show, Managing Principal, Daren Blonski. Welcome, Daren.

DAREN BLONSKI CFP®: Dan, how are you? Happy Friday.

DANO WEIR: I'm doing good. I'm loving our new logo. And I'm wondering one question, is AI swallowing your portfolio? That's our focus today. We're going to look at the slow creeping groundswell of AI, not only in the economy, maybe even in your workplace, but also what that means for your portfolio. It may be happening from an investment standpoint as well.

DANO WEIR: Plus what Las Vegas tourism numbers could be saying about the economy. Hey, the head of the IRS got fired and the Treasury secretary is now the head of the IRS or something. And why tariffs actually might be helping and hurting at the same time. But first, Daren, you're about to experience it for your first time, our brand new intro. Here we go.

DAREN BLONSKI CFP®: Nope, that's the old one, Dan.

DANO WEIR: Here it is.

DAREN BLONSKI CFP®: The stock market, the economy, your money. What's the latest and what could be next?

DAREN BLONSKI CFP®: Find out now with Fermata On The Markets. Straightforward financial market updates for the brands of Fermata Advisors, Sonoma Wealth Advisors, Fermata 401K, Fermata Tax, and Fermata Insurance. On The Markets starts now.

DAREN BLONSKI CFP®: That's pretty Fancy. Nice job, Dan.

DANO WEIR: Thank you. Thank you. Applause. Applause.

DAREN BLONSKI CFP®: Applause. If I had the applause button, like studio effect, I would play it for you.

DANO WEIR: Thank you. Of course, your hosts today are myself, Daniel Weir. I'm the marketing director for Sonoma Wealth. Daren, our managing principal. Chris is on assignment. We'll return next week. We're excited for that.

DANO WEIR: Daren, before we get into the show, I found this this week, and I wanted to share this with you. You are a Bitcoin enthusiast, maybe not a maximalist, but an enthusiast. And I thought this was so interesting. This is a tweet I found.

DAREN BLONSKI CFP®: Oh, you're a tech dev?

DANO WEIR: I don't know if I'm listening to it, but I thought this is an interesting tweet. I'm speaking to volatility and speaking to cruising through downturns.

DANO WEIR: This tweet says, if you put $100 into Bitcoin in 2010, you'd have $2.8 billion now. And on the tweet, he says, no. If you bought $100 of Bitcoin in 2010 and watched it go $1K, $100K, $1.7 million and did nothing, then watch $1.7 million go to $170K and still did nothing.

DANO WEIR: Then watch $170K go to $110 million and still did nothing, then watch $110 go to, and it goes on and on and on and on through the various ups and downs until finally, at the very end, watch $390 million surge to $2.8 billion. And then for some reason, finally decided to do something, then yes, $100 in 2010 would be worth $2.8 billion today. Doesn't that just speak to the rollercoaster nature of what Bitcoin's all about?

DAREN BLONSKI CFP®: Yeah, I mean, I think it, It speaks also to what the nature of adoption is, right? Because you could play that same game with the NVIDIA stock, right? And I think the point's well taken from TechDev. The reality is most people don't just hold it, right? They just don't. That's why, you know, the Bitcoin world, the crypto world kind of created this term called diamond hands, right?

DAREN BLONSKI CFP®: Like you're just going to hold it through the hard times and keep riding it through. But I think it gets more and more difficult as the price goes up to continue to hold it because, well, life happens and there's things you can do with that money and convert it back to fiat.

DAREN BLONSKI CFP®: But then you do have your hardcore that call it maximalists that will never sell any of their Bitcoin, will hold it forever. And there's certainly some of that going on. And there's certainly some that have held it that long. Recently, there was a wallet that moved with. At least that much in it. So there's some out there for sure.

DANO WEIR: We're going to mix it up a little bit this week. We're going to jump right into some of Daren's charts and graphs. First, I have a couple things to show on the back end, but Daren, if you want to get that ready and start to look at our central question to today's episode, which is, is AI swallowing your portfolio? You want to cue that up and have that? All right. You want to add it in there? I'll get it on the stage.

DAREN BLONSKI CFP®: Alright, so we're going to start with the S&P 500 today.

DAREN BLONSKI CFP®: Dan, can you adjust the look so you can't see our faces because then it's easier to see the screen there.

DAREN BLONSKI CFP®: I'll just make it just the screen.

DAREN BLONSKI CFP®: All right. So for those who know and those who don't know, the S&P 500 is the largest US-based stocks. So these are the stocks that are based in USA, mighty America. And it's generally thought of as the market, right? Some people think of the Dow Jones, which is made up of 30 stocks as the market. Some people think the S&P is the market. Jack shit. Thousands of stocks out there.

DAREN BLONSKI CFP®: But for the most part in the modern day, in the world of investing in 401ks, et cetera, people are buying something relative to a basket of S&P 500 stocks. That's typically what most portfolios are comprised of on some element or some deviation of that. So we use the S&P 500, the SPY in this case is an ETF. It's an index fund by brand that it tracks the S&P 500.

DAREN BLONSKI CFP®: You could also look at the SPX, which is actually just the index. It's not a brand you can buy per se. And you look at the charts. We try to discern what's going on. Now, we titled today, Why AI is Swallowing Your Portfolio, because we're continuing to see this run in these AI stocks. And so I thought a lot about why. And at what point will the wheels come off the bus? Is this going to be another dot-com bust?

DAREN BLONSKI CFP®: Really, people who have been diversified in their portfolios amongst stocks and bonds have not had a really great couple years. The only portfolios that have really done really well are over-concentrated in the AI stocks. Let me show you what this looks like visually, a little bit different, right? So I like this heat map, and we show this many weeks. The S&P 500 is made up of...

DAREN BLONSKI CFP®: These 500 stocks. The size of this box here represents the size of the capitalization or how big that company is from a capital standpoint in the S&P 500. So for example, NVIDIA is massive compared to Chevron and Exxon down here, or Eli Lilly compared to Pfizer or Johnson & Johnson, right? So when you look at the size of NVIDIA, it's literally bigger than the entire... Banking sector.

DAREN BLONSKI CFP®: Now think about that. NVIDIA, one company, is bigger than the entire banking sector.

DAREN BLONSKI CFP®: That's pretty crazy when you think about it. NVIDIA is like twice the size of the entire oil sector.

DAREN BLONSKI CFP®: I heard something the other day that something like 50% of NVIDIA employees are now multi-millionaires to the tune of 25 million plus. 50% of the employees. That's pretty wild. And what is NVIDIA? Well, NVIDIA builds chips, right?

DAREN BLONSKI CFP®: So if you look at what's happening is AI companies like ChatGPT, Grok, Anthropic, and others around the world are in need of these chips that process data and calculations in a really rapid way. So you can see NVIDIA is right at the crux of the drive that...

DAREN BLONSKI CFP®: AI needs in order to create what it's creating it needs chips it needs power and it needs infrastructure and so anything that relates to AI and supporting AI is doing incredibly well right now in fact i was just on the phone with a friend of mine who sells equipment electrical equipments like gear for creating data centers and there's an insatiable drive right now to build huge data centers and buy electrical gear, right?

DAREN BLONSKI CFP®: So if you look at what's doing really well in the construction industry right now, it's not building homes. It's not building skyrises. It's not building corporate locations. It's building big data centers. And what, in addition to inside those data centers, you have electrical gear, you have chips, and you have the need for power.

DAREN BLONSKI CFP®: And so NVIDIA, Microsoft, Apple, Amazon, Tesla, Google, and Meta are all these big players in this space. There's some other players that are not publicly traded, but all these companies are servicing this drive or the AI revolution that we're seeing. We are quite literally going through something equivalent right now to the Industrial Revolution.

DAREN BLONSKI CFP®: Some say in the next. 10 years, we're going to go through 100 years of advancement, technologically speaking. So think about that. In 10 years, we're going to do what we would have done in the past. In a hundred years. The amount of things that are about to change in our world, in every which way you can think of, is going to be very significant.

DAREN BLONSKI CFP®: And I venture to guess that many, many people are going to really struggle to adapt to those changes. And those changes that are happening will create lots of sociological issues. They will create lots of fighting between governments. Whoever gets to what we call AGI.

DAREN BLONSKI CFP®: So there's AI, which is artificial intelligence, and there's artificial growth intelligence, which is AGI. There's artificial super growth intelligence, which is a whole other level. Whoever gets there first is going to have an insane amount of power in the world because their ability to affect economic activity on every level.

DAREN BLONSKI CFP®: Where are we starting to see things like this showing up? Well, I wanted to show... The unemployment rate for college graduates to start. So I've been kind of watching this in the background because I've been reading a lot about AI and what it's doing to our world and what it's creating.

DAREN BLONSKI CFP®: It's going to create immense opportunity and it's going to create immense change, change like we've never seen before. I don't think most people are even ready. I don't think I'm even ready for it. And I read and study about it all the time. And when you think about every aspect of our life being impacted. That's what's coming.

DAREN BLONSKI CFP®: So like unemployment rate for college grads, what we're finding already is that AI bots are being deployed, AI agents are being deployed and replacing entry level work. So college graduates coming out with a master's degree 25 years and older, we haven't seen skyrocketing unemployment like this since COVID.

DAREN BLONSKI CFP®: So what's going on? Are we hitting a massive recession? Is hiring slowing down? Or are people just going other places? To fulfill what an entry-level person might be doing.

DAREN BLONSKI CFP®: I surmise, and one thesis is that, in fact, a lot of these jobs that would be going to college graduates as master degrees are not going there. They're going to AI agents. They're filling a lot of those basic things like legal writing, if you have a law degree, programming, if you have a software degree, and on and on and on.

DAREN BLONSKI CFP®: And that's problematic on a lot of levels, right? That will create massive amount of change in our world. So when we go back to the S&P and we look at the S&P and how it's constructed, it's made up of these 500 companies. What's happening is the market's almost telling us that, hey, look, all these jobs over here, banking, real estate, oil, all those jobs, utilities.

DAREN BLONSKI CFP®: AI is going to take those jobs over and it's going to suck up a matching and disproportion amount of the GDP or gross domestic product for the world and for, well, domestic being United States. So it's something we're watching.

DAREN BLONSKI CFP®: And so one of the questions that you have to be asking yourself at this point, if you're an investor is, do I just keep piling into something like the S&P that is highly concentrated in these big stocks? Or is this bubble going to pop here at some point and there'll be a rebalance?

DAREN BLONSKI CFP®: For example, in the nifty 50 area and those who watch this show on a regular basis have heard me say this, that XOE needs to be the biggest square on this heat map. And it's no longer because there's been a rebalance.

DAREN BLONSKI CFP®: Will we have a 2001 bubble pop like we saw in 2001 where everything was going to be WWW and then all of a sudden overnight it wasn't? Are we going to see a similar impact? We call this the S adoption curve with AI, where AI won't live up to all the promises that we think we're getting told at this point.

DAREN BLONSKI CFP®: It's possible, but when you really dig deeper, the people who are in the know, who really work in these companies, they're saying that, well, actually, nobody's prepared for how fast we're about to see things change. In our world.

DAREN BLONSKI CFP®: I think that's concerning on a lot of levels, but I think it's, you know, from my perspective in managing portfolios and helping people with retirement and thinking about how do we invest, how do we structure, how do we position, how do we protect livelihoods, that becomes even more of a concern.

DANO WEIR: I think something to think about, Daren, because I was just thinking about this today. I was thinking about how I needed to go to Target to get something. And I was like, ah, I got to go make a Target run. And I was like, you know, it's interesting.

DANO WEIR: I had a, you and I both went to Casa Grande High School in Petaluma. We were bringing up all the time. It's local. Connects people. We had a. A sub one day. It was a sub in my geometry class. And he was an early investor in, I think it was Webvan, which was a website grocery delivery service.

DAREN BLONSKI CFP®: I remember Webvan.

DANO WEIR: And he was explaining to me how in the future, nobody's going to go to the grocery store. There will be no grocery stores, and we're all going to do it online. And I was like, man, what about when I need to go get a jar of pasta sauce? He's like, no, you're going to just plan everything ahead. I remember thinking he was such an idiot. And so here we are now in the future from that past of the year 2000.

DANO WEIR: There's still Target. There's still Safeway. But also, I do basically zip a lot of stuff from Amazon in one to two days. And what there isn't is there's not Sears. And there's not like a local mom and pop that is providing, you know, shelf goods anymore.

DANO WEIR: So there are other businesses that are mom and pop shops, but it's just a perfect example of it did massively change. Some of it didn't. It wasn't 100% takeover, but it was a pretty significant change. So who knows? But I just, I thought of that and I was like, I wonder if that's how AI is going to be.

DAREN BLONSKI CFP®: Well, I think on some level. So, you know, I... I think the ability for artificial growth intelligence, artificial intelligence to interact with us at this juncture is mostly an issue of access. Right. And what do I mean by that? Right. Like there exists these agents in this code that can interact with us, but it doesn't have access to all the different platforms that would enable it to be truly functional for us.

DAREN BLONSKI CFP®: So what we will see over time, and we see this a lot with different technology tools we use in our business, we have things called APIs. So all our technology, we might have a system that does one thing and a system that does another thing. And the way they communicate is they communicate through APIs. And so the way that AI is being connected into all of our lives right now is through APIs.

DAREN BLONSKI CFP®: So in the back end, there's what's called a large language model. And that data set that's in some piece of technology you use will go get sent into that large language model. And a token will be basically pay a token to do a calculation. And that large language model then has an output to it. And that's how it's happening right now. But the binder, the hang up is access, right? There's not access to everything.

DAREN BLONSKI CFP®: And I think... Access will go slowly but faster than people think. And the more access that's created, then you'll start to see things change more rapidly. Where you'll see things go slower is in things like healthcare, where you have to protect data.

DAREN BLONSKI CFP®: In financial services, where you have data you have to protect. You'll see things, though, where there isn't data requirements. You know, we're already seeing this in school, right? And you talk to the kids at school and every one of them's on some level, very familiar talking to an AI agent.

DAREN BLONSKI CFP®: I remember growing up, our parents looked at us like, oh, you guys are the, you know, internet natives, they would used to call us. And now we'll look at our kids. My kids have now been interacting with agents for two or three years. It's not going to be weird for them to continue.

DAREN BLONSKI CFP®: To interact with agents and to a greater extent as they mature and grow and figure out how to even support themselves in this world now that a lot of the jobs they probably would have liked to do won't be needed because agents will do it much more efficiently for less cost and that's concerning too so when you look at how does this relate to portfolios and you look at themes for investing and we think about themes for investing every some are arguing like this is just crazy it's way overbought there's too much money going into AI it's going to pop and that might be true and it might pop but it also might not so what if it doesn't and that's what keeps me up at night what if it doesn't what if quite literally AI becomes this thing and we don't have the s curve of adoption and it literally just absorbs massive portions of gross domestic product meaning it takes job after job after job.

DAREN BLONSKI CFP®: The last jobs to go are going to be ones that are protected because they control some kind of data and jobs that require physicality to them, like roofers and landscapers. And then I also started thinking, and what I like to think about is these larger themes you see going on in this anti-immigration piece that we've been seeing come through pretty heavily in geopolitics.

DAREN BLONSKI CFP®: And I like to step back from that, not go, oh, Republican, oh, Democrat. Get all up in arms about that, but say, what is the theme here? Why is this happening now? And why is this an issue?

DAREN BLONSKI CFP®: And why are the politicians using this as a mechanism to garner power and control? And one of the things I wonder, and it might be a little early, but I'm wondering if jobs are going to become so scarce that that's going to drive anti-immigration, because people are going to need jobs.

DAREN BLONSKI CFP®: So right now... A lot of people are saying these ICE raids are crazy because we need people to do jobs, especially in one country where we are. And there's not going to be any people if we get rid of immigration, which is true on some level.

DAREN BLONSKI CFP®: But I also wonder if AI relegates our jobs, that there becomes a scarcity of jobs. And so now they're across the world becomes this very like protectionism stance. So the populist people. So. Believe it or not, both Trump and Biden are considered populist politicians, and they're playing to a populist crowd.

DAREN BLONSKI CFP®: And so as AI starts attacking jobs and taking away jobs like we're already starting to see for college grads, I wonder if that becomes an even more bigger discussion point.

DAREN BLONSKI CFP®: And I always wonder, like, what's Paul Harvey used to say on the radio? What's the rest of the story? What's the story?

DAREN BLONSKI CFP®: Under the story what is it that we don't see and why are we seeing the things we're seeing right now and why are the politicians holding these things out for us to see all right so when we look at the S&P 500 and we go back to the charts and we read and let's just say okay what's happening on his face right now right we talked about this a couple weeks ago we talked about summer's gonna float higher We talked about that typically that's the norm.

DAREN BLONSKI CFP®: There's not a lot of volume in the market, but when we come back in September, you tend to see more volatility happen. And there's a conspiracy. I don't know if it's conspiracy or truth, whatever. But there's a conspiracy that all the traders are away from Wall Street during the.

DAREN BLONSKI CFP®: The summer holiday and they come back in September and the prices have all floated higher so they smashed the portfolio they smashed the market down and there's some crisis that happens that creates an issue so this is the s p 500 you can see the float higher this week you can see Monday we had a nice move Tuesday Wednesday Thursday so these are candlesticks we're looking at and showing price action from that.

DAREN BLONSKI CFP®: Period of time and if we look at this as being primary support you can see really around 6 6 200 we got a nice little bounce that was the bottom so we had this little correction and then a nice bounce so a couple things you're seeing really happen right now this is a solid close the close this week was real nice if you look on a weekly chart you can see it's pretty healthy The fact they didn't close just slightly higher above 6400 shows slight weakness in resistance.

DAREN BLONSKI CFP®: You could argue that that's kind of looking at a triple top-ish type. I don't know what we got to see in a shorter time frame.

DAREN BLONSKI CFP®: But generally, I think that's a pretty solid close. I would go into Monday feeling pretty positive. What did we see after the bell today? Well, Armenia and...

DAREN BLONSKI CFP®: Amerjee John I always screw that name up is it azerbaijan azerbaijan there you go and they just signed a peace deal which is incredible that has not been in forever Putin and his cronies all presented a plan to Trump that they're basically gonna end the war in exchange for Eastern Ukraine the Donbass region and they're gonna meet with Trump next Thursday i i can't imagine Trump and Putin meeting in Alaska without having any outcome so my guess is behind the scenes something's already been agreed to and they're going there to ink the deal so that's In the Ukraine War, yep.

DANO WEIR: Okay.

DAREN BLONSKI CFP®: So Trump and Putin are going to be meeting in Alaska next Thursday.

DAREN BLONSKI CFP®: Russia came out today and said, well, you know, we'll do a ceasefire, but we want Eastern Ukraine. We want Donbass and then that area below Donbass. What is it?

DAREN BLONSKI CFP®: Where they have the bridge to blanking on it moment. But and then we so that was it. These peace deals are huge, right? So global politics calms down. Interesting, though, that Trump really put it to India this week. So all along during the Ukrainian War, India has been basically supporting the war machine for Russia by buying their black market oil.

DAREN BLONSKI CFP®: And earlier this week, Trump said, hey, no more India, we're going to smack some more tariffs on you. And then now magically... Putin's like, oh, okay, yeah, yeah, yeah. We want some peace. Here's how we want peace. You guys good with that? So we'll see where that goes. But that's really hopeful. I mean, it's been just a horrific and a lot of really innocent people have suffered.

DANO WEIR: Are you talking about the Kerch Strait Bridge to Crimea?

DAREN BLONSKI CFP®: Yeah, in Crimea. That's what I'm talking about. And so basically, Putin is proposing that if Ukraine gives up Crimea in eastern Donbass, then they'll agree to a ceasefire.

DAREN BLONSKI CFP®: Initially there was a big push saying no we won't give up anything but i think the war has dragged on and kill enough people that people are willing to compromise at this point so that's i think meaningful it's also really interesting i in in Danny talked about this in our opening about Besant today basically replacing the head of the IRS chief number Trump is moving to Irish chief two months after he's confirmed, and Besson's going to take over.

DAREN BLONSKI CFP®: It sounds like Thune, though, last week, Senator Thune was blocking any more confirmations for Trump, so he probably doesn't have a choice other than to put Besson in place. But Besson's certainly been a pretty good whipping boy for Trump during this administration so far.

DANO WEIR: Has that ever happened? Has that ever happened? I don't know if you know, but I mean, to have the Treasury Secretary in charge of yet another massive agency, or at least as the acting commissioner, I guess. Okay, acting.

DAREN BLONSKI CFP®: He's acting, but the IRS reports under the Treasury, I believe. So it's just like the boss's boss. I believe that's how it works. Wow. But yeah, kind of interesting as Trump continues to try to affect all the changes he's trying to affect and to make. And that really goes back to you mentioning our opening on these tariffs, right?

DAREN BLONSKI CFP®: And it's turning out like these tariffs are generating a lot of money now. And they're actually, man, don't crucify me because I'm just the messenger here because I know I'm going to get some hate mail from people for this. But it actually looks like tariffs are somewhat effective at this point.

DAREN BLONSKI CFP®: And here's what I meant by the opening when they're helping and hurting us. It looks to me like tariffs are actually forcing geopolitical players to not fight wars and to solve wars. And the way Trump has been using tariffs to get these players to the table like Putin and others, it's interesting or bringing India to say, look, stop buying this garbage or we're just going to tariff you guys so that Putin gets no more money.

DAREN BLONSKI CFP®: So he didn't have a choice. He can't keep pushing his war machine. So I think it's helping world peace. Tariffs are actually helping world peace. Again, don't shoot the messenger. But the facts are suggesting that they're helping world peace, which is.

DANO WEIR: Shocking because in March i don't think anyone felt like the tariffs were going to help create world peace no you know i i better to compare a tactic i used to something that Trump has done but what he when he implemented that when i when he announced that he would be doing the tariffs the first thing i thought of is a strategy i use with my kids which is that i take away something they like, which they presumed to be a theirs in perpetuity.

DANO WEIR: So they love YouTube. They love YouTube. And YouTube, if left unhindered or unstopped, I don't know that they would ever stop watching YouTube. And so when it's time to do X, Y, and Z, chores, homework, whatever, boom, guess what? I just took YouTube away. It's gone.

DANO WEIR: Every parent's done that before, right? That, to me, is basically what he was doing. With chairs is that he basically just said like yeah the free ride's over i'm gonna do this and all of a sudden now everybody's got to run around we're gonna come up with all the reasons why fill in the blank and also the move is risky because maybe it wouldn't have worked Maybe it's still not working.

DANO WEIR: But the tariff revenue is definitely up, and you do have some people who are coming to the table in a way that they haven't before.

DANO WEIR: And then just as I've done with my kids, as I start doing a few of the things that I want, well, you start walking it back and say, okay, here's an hour, here's two hours, whatever it is. But you basically take a resource that they thought was infinite and you put a price tag on it. And so far seems might be working.

DAREN BLONSKI CFP®: Yeah. I mean, certainly working, not been other byproducts of that, right? Like I had a conversation with a gentleman who's a foreman for a local roofing company and he said he's never seen it slower in 15 years.

DAREN BLONSKI CFP®: So we were talking to another large framing contractor and things are really slow.

DAREN BLONSKI CFP®: So. I think there's other sides to the story, right? I think it might be helping create world peace. It might be creating revenues on tariffs, but I think it also might be slowing the economy to some degree.

DAREN BLONSKI CFP®: And I think it might be creating a system where people are less likely to make a commitment for the long term. I think you're also seeing that when we go back to the AI stuff, though, because you've got, if all of a sudden, like everybody's sure that these agents are going to come out and start replacing jobs.

DAREN BLONSKI CFP®: If you're an employer and you're hiring people, you're going to be like, let's hold off on hiring because we don't want to have to create a more difficult situation for the, you know, we all lay off a bunch of people. Oh, it looks like we can use AI now. Right.

DAREN BLONSKI CFP®: I think in the very near future, we're going to see some regulation around like not being able to lay off people if their job is being replaced by an AI agent. It's going to be a really, really fascinating battle to see play out. And a sad one too, because it's going to impact a lot of people.

DAREN BLONSKI CFP®: So let's zip through the charts. So you can see S&P closed pretty nice.

DAREN BLONSKI CFP®: I'll take that close to the bank. That makes Monday look good with all this after the bell news coming in with some peace deals looking on the horizon. I think that's pretty good economically. War is not good for business.

DAREN BLONSKI CFP®: And if we can solve some more, that's good. Well, that's not necessarily true. War is actually really good for business, for certain kinds of businesses. So don't fear. There will still be war for those who want it.

DAREN BLONSKI CFP®: This is the gold chart. The gold chart is just in a sideways pattern. I brought this up because gold has done very well this year.

DAREN BLONSKI CFP®: It really had a nice run early on in the year and then just kind of traded sideways. It's starting to look like distribution, though. Meaning, and what does distribution look like? Distribution is that the buyers and sellers get worn out here and then eventually it drops down. That's how I would read that chart.

DAREN BLONSKI CFP®: It would make sense if gold were to go down in value because there's less fear about the future of the world. If wars are coming to an end, that would make sense. When we look at the bond market. Has broken out from this downtrend line, which is good. It's still just petering along, albeit we are hearing, and we've been saying this for a couple months, we're seeing things that look recessionary out there.

DAREN BLONSKI CFP®: But I have full faith that the Federal Reserve, once Trump gets a hold of it, will stimulate to the moon like they have in every other major moment. Pretty interesting that Besant is, you know, he's taking over so much power in the administration.

DAREN BLONSKI CFP®: What's kind of interesting about the ag here that you can see, this was an important support zone way back when, and we're coming right up into there. The fact that we shot up into this area previously, and then we've revisited this area again tells me we're probably going to go higher.

DAREN BLONSKI CFP®: That tells me that there's going to be kind of some risk off, although that's flying in the face of the gold chart, which looks like in distribution. If you back out, though, you could also argue that the gold chart is just in a bold flag. You can see that kind of bold flag-looking chart pattern right there.

DANO WEIR: That bond chart you showed, the ag, is this the chart where it's good where it goes up? Because there is a bond chart where it's bad when it goes up.

DAREN BLONSKI CFP®: This is good. I mean, the value of bonds, right? If bonds are more valuable, then that says people are more fearful, generally speaking, right? Because they typically make more money in bonds.

DANO WEIR: But the 10-year, when that goes up, that's bad for bondholders?

DAREN BLONSKI CFP®: It's inverse. So the 10-year Treasury is inversely related to bond. So when the 10-year goes up, bond values go down. When the 10-year goes down, bond values go up. And so what we saw in 2022, now the worst bond year ever, was this period right here where interest rates were going up, and that was just collapsing bond prices. And that's what created all the bank failures.

DAREN BLONSKI CFP®: So if the 10-year starts going down, then that will be- good for bonds, that will bail out a lot of the banks. But if the 10-year starts going down, what that typically means is the Feds are lowering rates. And if they're lowering rates substantially, that's because they're really scared and something's not good in the economy. So when we look at the Fed funds rate, so this is the rate that the Fed can control.

DAREN BLONSKI CFP®: And it's a short end of the stick, the Fed funds rate, you can see. So historically, in most recent past, when the Fed funds rate kind of caps out, goes sideways, you have these periods where the rates kind of float down and then they precipitously drop. And that's in response to some type of economic event. You have Trump and Besant really trying to push.

DAREN BLONSKI CFP®: This chart right here is what Trump and Besant are really pushing on Chair Powell to push debt. Because if they push it down one, it adds less to the national debt. And two, it's very stimulative in the economy. The Fed is saying, well, we don't want to push it down too quick. Because if we push it down too quick, one, inflation will be back.

DAREN BLONSKI CFP®: And two, because that will be too stimulative and the economy is doing quite well. But that's where I think Main Street and Wall Street are not aligned. Because when you talk to Main Street, Main Street's kind of suffering right now. When I talk to any contractors, I talk to housing, those areas are struggling. The people are doing well right now. Does anyone have anything to do with AI?

DANO WEIR: I was going to say, if you drop this rate right now and cash is much more readily available, it ain't going to the Russell 2000. It ain't going to mom and pop. It's going to those big boxes you showed on the heat map.

DANO WEIR: You're just going to be magnifying the concentration even further.

DAREN BLONSKI CFP®: Right. I mean, people will just throw their money into this world and just grow a bigger and bigger bubble.

DAREN BLONSKI CFP®: And I think we have to call it a bubble, right? Like, history would suggest a bubble, and sure, this time could be different, but I think we need to operate with the assumption that at some point, the bubble's going to bust and it's going to be a bad day for the S&P 500.

DAREN BLONSKI CFP®: So this is what's called yield curve. And so this is comparing the 10-year bond to the two-year bond. So the yield curve, and there's different measurements of the yield curve, has been pretty consistent over time predicting recessions. When recessions happen is when you get these inversions that happen right here. You can see right there, that's an inversion, that's an inversion.

DAREN BLONSKI CFP®: And this is a really big inversion we just finished. But when you start to see the recession is when you see the yield curve re-steepened. And the only time it re-steepened is when the Fed starts to decrease the rates substantially. And so in a perfect world, the Federal Reserve will lower the rates slowly.

DAREN BLONSKI CFP®: But historically, rates have been much higher for much longer. And if you talk to too many people who bought houses last... 30 years, they remember buying their first house at 14% or 10% interest. The reason it feels so painful this time is it just went up so fast. But we are seeing a lot more sellers than buyers in the real estate market. I think that's a concern for the overall economy.

DAREN BLONSKI CFP®: People just can't buy right now. When we look at some of our stock signals, like the Dow Jones transportation, so the Dow Jones transportation is a measurement of all those stocks that are in the transportation side of the Dow Jones. And so the thinking of there is that this is the arteries of the economy.

DAREN BLONSKI CFP®: There's nothing really meaningful there suggesting that, A, we got a big issue. When we look at IWM, which is also a canary in the coal mine, when it comes to stock market issues, it's looking like it's going to take on and try and break out the all-time new highs. So I go back to tariffs are helping and hurting us. Well, if IWM, which are smaller companies...

DAREN BLONSKI CFP®: Are getting valued more and the market says that's good it looks like the tariffs are actually helping our smaller companies and that's good for America not so good if you're not America The SOX, the Philadelphia Semiconductor Index. So this is kind of the front end, the tip of the sphere of risk. And you can see we're at all-time highs right there and ready to break out.

DAREN BLONSKI CFP®: Igv which is the beer these are the these are your most like tech startups tech software that's knocking on all-time highs as well you could argue that there's a real ugly triple top there one there there's a top there's a top and there's a top so i'd be curious if we lose this area about 107 i would be really nervous about that chart so some but right now things i think we're floating higher i don't think you can discern much right now until we get back into September and really see the volume come back in the market anyway interesting week lots going on as always hopefully that was helpful in Las Vegas Dan yeah i got one more before actually two more as you go out the door here.

DANO WEIR: We... Typically, Chris has our economy slides, and we look forward to him returning next week. But Darren, one of the things I bring to the show, and there's really not much, but I bring the vibe and the narrative and what are people talking about. And I do spend a little bit too much time on the Instagram feed.

DANO WEIR: And this week, I saw nonstop, nonstop commentary about a dip in Vegas tourism. That Vegas is struggling this summer. And I, just for context, I don't go to Las Vegas. I don't follow Las Vegas. I don't search for Las Vegas. It just popped up in my feed. So when it comes out of nowhere into my feed, it becomes a thing.

DANO WEIR: So I dug into this a little bit more. For the sixth consecutive month this year, Las Vegas experienced a decline in the number of visitors year over year, with June seeing nearly 400,000 fewer visitors. Or an 11.3% drop compared to the same time last year. That's coming from the Las Vegas Convention And Visitors Authority.

DANO WEIR: Also on the road on Interstate 15 at the California-Nevada border, that dipped in June by 4.3%. That's according to the Las Vegas Review-Journal. So we always just keep an eye on things like this. And my gosh, if there isn't, speaking of a canary in the coal mine, if there isn't an indicator of something that's totally unnecessary, it's Las Vegas.

DANO WEIR: So if, if things are, you know, if people are starting to struggle financially, that lavish trip to Las Vegas, if a company is starting to struggle financially, that big conference in Las Vegas, you know, maybe we keep it a little closer to home. Maybe we don't do it at all.

DANO WEIR: The, the impact of tourism and activity in Las Vegas this week was very interesting to me. I wanted to share it on the show.

DAREN BLONSKI CFP®: Yeah.

DAREN BLONSKI CFP®: I was actually just listening to some commentary on that, but one of the other things that the commentator pointed out is we we have a saying in in economics the marginal buy and that's like that's what we've seen in wine country right wine wine business is really struggling right now because the marginal buyer's gone and the marginal buyer is that last buyer who pushes the price just a little bit higher right so like in the wine business where we this generation's just not drinking wine as much so doing other things that marginal buyer has eviscerated the pricing And so we've seen lots of issues with our clients and people who are working in the wine industry.

DAREN BLONSKI CFP®: And the same is with Vegas. A lot of people are just going online and gambling. They can gamble from their phone now. I mean, heck, you can go to Polymarket and make bets on anything happening in the world. Geopolitically, you can get your fix without paying thousands of dollars for a hotel and thousands of dollars for a flight and really expensive.

DAREN BLONSKI CFP®: Food that's just going to make you really unhealthy anyway so that marginal buyer is evaporated out of that market and i can confirm this i was just there twice actually it's funny my whole career i've never been to Vegas and this year when there were three conferences the cpa conference there was oh no i was there for a wedding and i was there for one other oh it was the 401k conference was in Vegas and i i like to just talk to the drivers and the Uber drivers whatnot when I'm traveling and they confirmed that, yeah, it's really slowed down a lot in Vegas this year.

DANO WEIR: Well, it's a 300% increase for you. So maybe you're, you're the, you're the outlier.

DAREN BLONSKI CFP®: I'm doing my part.

DANO WEIR: I just thought that was interesting. I got one more for you, Darren. You're going to love that. I found a way to talk about football because football is starting. And I just thought this was some, really interesting perspective. This is just a tweet. It's from a lineman who used to play on the Chargers. Now he's on the Steelers.

DANO WEIR: His name is Braden Fajoko. Somebody asked him on Twitter, they said, what's a darker side of the NFL that no one talks about? And he replied, I watched teammates spend a year worth of salary, which to a lot of guys in the NFL is only $600,000. Some even more post taxes and have nothing right before the start of the season.

DANO WEIR: Nobody will admit it, but there's guys in the league on big contracts right now that are figuratively broke, liquidating assets as we speak. I just thought that was interesting because the NFL is the quintessential, like, millionaires playing a child's game. That's what people like to say. They're all millionaires. They're all millionaires.

DANO WEIR: And the reality is a lot of these guys are taking a haircut on taxes to start, and then they start living that lifestyle too. So our show is all about kind of giving perspective and digging a little bit deeper on some of these things. And so that was an interesting example of even big sports stars are living beyond their means.

DAREN BLONSKI CFP®: Yeah. That's a classic example, Dan. For sure. I see a lot in tech people too, right? Like I'll go meet with a client and you start talking to him like, oh, what are you guys doing this weekend? And I mean, some of the stuff they're doing in the tech world for entertainment is pretty lavish. But some of the newer hires don't have all the money that some of the early hires have.

DAREN BLONSKI CFP®: And it's interesting to hear them talk about it. And literally, on the air for this one guy I was talking to at Google, he just started Googling and paid $250,000 a year. Just burning through everything as a single dude because he was just spending all his weekend partying and boats and planes. It's pretty wild.

DANO WEIR: And? Oh, go ahead.

DAREN BLONSKI CFP®: Well, like they say, you do what the seven friends around you do most, right?

DANO WEIR: And something to think about, especially those newer hires. As we wrap up the episode here.

DANO WEIR: Is the lavish spending and the living beyond your means all make sense until maybe you get that knock on your door, you get that ping on your phone that the chatbot has taken your job? So we're not doomers around here. We're our growth mindset. But today's episode was, is AI swallowing your portfolio? I hope that we were able to show you that perhaps it is, but is or is there not a bubble forming?

DANO WEIR: I guess we'll find out together. So, thank you so much for joining us on the show. We are On The Markets for the brands of Fermata Advisors, which is our flagship wealth parents and I'm a wealth as well as Fermata 401K Fermata Tax, the Fermata family of brands. If you'd like to learn more about us, Hey, I got a nifty little video to close us out.

DANO WEIR: I'll play that in a second. Also make sure wherever you're watching or listening, please subscribe. If you like us, if you enjoy what we're doing. Subscribing to our shows on YouTube, on Spotify, on Apple Podcasts. It really does help. So we appreciate you checking things out and hope you found value today. Darren, thanks for a great show.

DAREN BLONSKI CFP®: You bet. Thanks, everyone. Take care.

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